CI VIEW: The Carolina Kitchen aims at USD 1bn IPO valuation, owner Lance London says UPDATE

 

WASHINGTON/LOS ANGELES (BBN) —  (Update on September 21, 2016 to add interview with Thompson Hospitality Chairman Warren Thompson) The Carolina Kitchen, the Washington, DC area high-scale soul and southern cuisine restaurant group, sees revenues rising to USD 45m at end-2014 from more than USD 20m in 2013, The Carolina Kitchen founder and CEO Lance London said.

[Carolina Kitchen owner Lance London speaks to Capitol Intelligence/BBN using CI Glass at Rhode Island Row opening Feb. 25, 2014]

In an interview at the opening of Carolina Kitchen on Rhode Island Row in northeast DC, London said his aim is to build The Carolina Kitchen group into a USD 1bn business and to continue expanding from its current locations of Largo and Hyattsville in Prince George’s County, Maryland and now Washington, DC.

The Carolina Kitchen offers a high-end southern and soul cuisine of seafood, ribs and chicken that appeals to both African-Americans and those from the South.

Industrial Bank chief executive Doyle Mitchell, Jr said his family-owned bank was the first and remains the main financing source of Lance London’s business, which includes a large scale catering operation and a newly launched TKO Burger chain.

Both Mitchell and London said the success of The Carolina Kitchen is only one example of the dynamic change in the historically African-American communities of the Washington, DC and Prince Georges County in Maryland. The enormous growth in the DC area, ranked second in job creation nationwide, has been fueled by the growth of private sector companies attracted to DC’s economic boom.

Not only has The Carolina Kitchen attracted the attention of Calabasas Hill, California-based The CheeseCake Factory Inc. (NASDAQ:CAKE) but also the Los Angeles-based Magic Johnson Enterprise (MJE) and his private equity JV partner, Ron Burkle’s The Yucaipa Companies, sources familiar with the matter told Capitol Intelligence.

The Carolina Kitchen founder London said that he modeled his chain somewhat after The Cheesecake Factory white comfort chain. The Cheesecake Factory has a current market capitalization of USD 2.3 bn and recently signed agreements to expand in the highly lucrative markets of the United Arab Emirates: Kuwait; Bahrain; Qatar; the Kingdom of Saudi Arabia and Asian markets such of Malaysia; Singapore; and South Korea.

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In a major new expansion, Carolina Kitchen is in the process of becoming a cornerstone restaurant in the new USD 1.2bn Paradise, Nevada-based MGM Resorts International mega new casino located in National Harbor in Prince George’s Country Maryland.

Los Angeles-based Okra Restaurant Group, INC founder Richard Petty — one of the top ten African-American haute cuisine chefs in the United States, has already started to launch what will be a US and international American Heritage Cuisine franchise–with his Red Yam Southern Grille fast casual restaurants.

[Okra Restaurant Group. INC and Red Yam founder Richard Petty speaks to Capitol Intelligence/BBN at Wells Fargo Center in Los Angeles. May 9, 2015]

Chef Petty, a Detroit native who moved to Los Angeles after serving in Vietnam and studying business administration at the Detroit College of Business and El Camino College with the GI Bill — was one of the key players behind the wildly successful upscale African-American Reign restaurant in Beverly Hills and worked with European celebrity chefs like Wolfgang Puck and Bradley Ogden and had been the executive chef at the Beverly Hills Inn and Monty’s Steakhouse.

During an interview at Petty’s offices on the 24th floor of Wells Fargo & Company (NYSE: WFC) headquarters in the center of Los Angeles’ Financial District, Petty explained why American Heritage Cuisine is much more than Southern or Soul food but has its roots in the foundation of America itself.

“The American Heritage is the fabric of what our country is about,” Petty said. “Also the industry does not recognize the African-American equation at all, we will spend USD 1.3 trillion this year, and eating out is at the top of the list.”

He noted the culinary traditions range from Haiti rooted Creole and Canjun cuisines in Louisiana; Carolina low-country and other dishes from across the southern United States.

The appeal of Southern American Cuisine as presented by The Carolina Kitchen and Red Yam Southern Grille is not limited to African-Americans or white southerners but surprisingly popular with Europeans, Asians and Africans.

Chef Petty and his Okra group has already won coveted contracts from the University of Southern California (USC) and completed the soon-to-be opened Black Bottom Southern Cafe in North Hollywood owned by Grey’s Anatomy star James Pickens, Jr and his wife Gina Taylor.

 Thompson Hospitality President and Chairman Warren Thompson told Capitol Intelligence/BBN that it is very impressive, and unusually difficult, for minority and veterans to win facility and catering contracts with private and state-owned colleges and universities.

[Thompson Hospitality President and Chairman Warren Thompson speaks to Capitol Intelligence/BBN using CI Glass Closing the Wealth Gap hosted by US House Financial Services Ranking Member Maxine Waters (D-CA) at the CBCF ALC  in Washington, DC]

Petty said that he has already been approached by potential franchise partners in Nigeria and that he is planning the flagship Red Yam restaurant in Los Angeles’ Little Tokyo neighborhood in downtown LA.

[Okra Restaurant Group, INC and Red Yam Southern Grille founder Chef Richard Petty explains to  Capitol Intelligence/BBN using CI Glass its planned flagship in Los Angeles’ Little Tokyo neighborhood. May 9, 2015]

Petty, who is an award winning chef recognized by America’s prestigious James Beard Foundation, said he was inspired to launch Red Yam not as a traditional restaurant group but as a listed company following President Barack Obama announcement of the US Jobs Act.

The Jobs Act — a brainchild of US Treasury Secretary Timothy Geithner — was launched as a tool to create new jobs and growth, with special focus on veteran and minority-owned companies and those start-ups founded in traditionally economically depressed areas in the United States.

The Jobs Act has allowed Petty to register Okra Restaurant with the Securities and Exchange Commission as a 506(C) company and can freely sell shares to qualified investors much like a company on the main board of the NYSE and NASDAQ.

In fact, the Jobs Act focus on minority and veteran owned businesses is a priority for the SEC Chair Mary Jo White and many SEC commissioners such as Daniel Gallagher.

The Okra Restaurant group is also one of few minority and veteran owned companies in the United States to have official EB-5 visa certification from the US Department of Homeland Security for its operations based in Compton, Los Angeles.

[Downtown Compton, California filmed by Capitol Intelligence/BBN using CI Glass,. September 24, 2016. ]

The EB-5 program allows foreign citizens to receive US green cards for investments of USD 500,000 in areas designated as economically depressed.

Carolina Kitchen ‘s Lance London and Okra’s Chef Richard Petty are unique leaders in the emerging American Heritage cuisine culture and are transforming a fast growing “niche” market into a national and global phenomena in the same way that European transplants such as Austria’s Wolfgang Puck and Britain’s Gordon Ramsay have in the United States. 

The United States is already witnessing a quiet but significant wealth creation events surrounding minority and/or veteran related businesses.

By PK Semler in Washington, DC and Los Angeles, California. For more information please call +1-202-549-3399 or email pks@capitolintelgroup.com

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